Question

A company’s overhead rate is 200% of direct labor cost. Using the following incomplete accounts, determine the cost of direct materials used.

Saved Help Save & Exit Subr A company's overhead rate is 200% of direct labor cost. Using the following incomplete accounts, determine the cost of direct materials used. Work in Process Inventory 58,000 Beginning WIP Direct Materials Direct Labor Applied Overhead To Finished Goods Ending WIP 148,000 68,000 Factory Overhead 146,000 Finished Goods Inventory 48,000 273,000 43,000 Beginning FG 278,000 Ending FG < Prev 23 of 25 III Next >

Answer 1

Overhead applied = $148,000

Overhead rate = 200% of direct labor cost

Overhead applied = Direct labor cost x 200%

148,000 = Direct labor cost x 200%

Direct labor cost = $74,000

Work in process transferred to Finished goods = $273,000

Work in process transferred to Finished goods = Beginning work in process + Direct materials + Direct labor + Overhead applied - Ending work in process

273,000 = 58,000+ Direct materials + 74,000+148,000 - 68,000

Direct materials = $61,000

Work in Process Inventory
Beginning work in process	58,000
Direct materials	61,000
Direct labor	74,000
Applied overhead	148,000
To finished goods			273,000
Ending work in process	68,000

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